Refineries to ink plant upgrade deals in 45 days

The Express Tribune reported that the federal cabinet has taken about $6 billion of oil refinery upgrade projects out of the Oil and Gas Regulatory Authority's oversight. Under the amended policy, refineries now have 45 days, rather than 60, to conclude agreements with the Petroleum Division. Incentive payments will also be credited to upgrade accounts run by the ministry instead of Ogra's escrow account.

The government has named Inter State Gas Systems (ISGS) as the implementation agency, with key responsibilities moving first from Ogra to the Petroleum Division and then to the state-owned company. ISGS will open the upgrade accounts, monitor projects, appoint technical consultants and auditors, and make incentive payments. Industry officials, however, question whether the company has the expertise and resources for such an expanded mandate, given the technical complexity of modernisation.

According to the report, the cabinet was told modernisation could save about $1 billion a year in foreign exchange, and Saudi Arabia has shown interest in injecting capital. The policy aims to cut furnace oil output, expand petrol and diesel capacity and reduce lower-value products. The cabinet also ratified the Cabinet Committee on Energy's July 28, 2026 decision, whose directed amendments were incorporated into the final draft.